King Charles III is facing mounting pressure over his decision to personally fund the rent for Princess Beatrice and Princess Eugenie's royal residences, as officials defend the arrangement as a necessary security measure.
According to a recent National Audit Office report, the King has been covering the rent for his nieces' grace-and-favour homes using funds from his private Duchy of Lancaster income . The revelation has sparked backlash among British taxpayers, who question why non-working royals continue to benefit from subsidized palace living arrangements .
The audit revealed that Beatrice, 37, resides in a four-bedroom apartment at St James's Palace, while Eugenie, 36, occupies Ivy Cottage at Kensington Palace. Both properties are let at discounted rates of approximately 60% to 68% below market value, with rents based on outdated valuations from 2018 and 2020 . The arrangement was initially established during Queen Elizabeth II's reign, and Charles has continued it .
During a Commons committee appearance on Monday, Crown Estate chief executive Dan Labbad faced questions about the housing arrangements. James Chalmers, Keeper of the King's Privy Purse, defended the decision, emphasizing that the properties sit within sensitive security cordons requiring tenants with proper clearance .
"There are quite significant discounts on these properties because of the security implications," Chalmers explained, noting that finding suitable tenants with the right security vetting is challenging. "We don't want to get ourselves into a position where we start charging more or try to charge more and then find that people leave the palaces and actually it'll hurt the public purse, so it's a balance" .
Both princesses, as close royal family members who do not perform official duties, possess the necessary security clearance. Chalmers stressed that the properties would otherwise sit vacant, ultimately costing taxpayers more to maintain .
The controversy has been amplified by revelations about their father, Prince Andrew, who was found to have been subletting three cottages on the Royal Lodge estate for private income while paying only a peppercorn rent . Royal experts have suggested Andrew may have struck a deal with his brother to secure his daughters' housing arrangements .
Critics have pointed out that both Beatrice and Eugenie own substantial private properties outside London — Beatrice a Cotswold farmhouse and Eugenie a seaside villa in Portugal — and maintain independent careers . Questions have also been raised about whether using Privy Purse funds for non-working royals constitutes proper use of resources .
Why this matters
The scrutiny reflects growing public demand for financial transparency within the monarchy, particularly as the royal family pursues a "slimmed-down" vision under King Charles . For U.S. audiences, the controversy highlights broader debates about taxpayer funding of royal privileges and the evolving role of non-working royals within the modern monarchy. The National Audit Office report marks the first comprehensive review of royal residences in over two decades, signaling increased parliamentary oversight of the institution's finances .
